Mortgage Market Predictions for Ontario in the Next Decade
It’s the end of an era. We said goodbye to the 2010s and welcomed in this century’s Roaring Twenties. But what does a new decade mean for people who plan to buy, sell or invest in real estate? We can’t predict every detail about the future of housing in Ontario, but we can use current data to give you a decent financial forecast. Let’s go through some of our expectations for the mortgage market in the 20s.
Canada’s housing market and therefore the mortgage market will enter 2020 with more momentum. We expect lower interest rates, strong labour markets and rapid population growth to keep demand on a recovery path. With decreased inventories we expect prices to climb. This suggests housing affordability tensions will increase after a year of slight improvement. As a result, this will present challenges for public policymakers.
What We Expect:
- Faster Online Applications with Income Confirmation
- Lowest Rate Transparency in Large Institutions
- Better Incentives and Provisions for Lender Switching
- Higher Demands for Housing
Speeding Up the Process
One thing we can count on is that advancing technology will make things go faster. How so? Even in the past 5 years, there has been a phenomenal increase in how many Canadians in Ontario apply for their mortgage online. As Canada makes information like income and employment confirmation accessible for financial institutions, we may finally see real approvals before ever entering an office.
Is this a good development? For customers looking for standard home purchases (especially if it’s not their first real estate deal), full online approvals have the potential to eliminate time spent on waiting for appointments. First-time homebuyers, those buying a cottage or rental property along with self-employed homebuyers will find added value in sitting down with a knowledgeable mortgage broker no matter how fast the online application process gets.
Less Rate Runaround
In Ontario, we’ve long accepted that banks don’t tell us about their best rates. Many of the “Big Five” even reward financial representatives with higher sales numbers for giving out higher mortgage rates. But during 2019, things shifted. Online and provincial banks attracted more customers by being upfront about their biggest deals. The result? Big Five banks took a hit. Hundreds of thousands of tech-savvy clients know that doing some online research ahead of time can save them thousands of dollars throughout their term.
As things get competitive, it will likely be harder to sort through the deals and determine which one is right for your situation. Recruiting an experienced mortgage broker with the inside scoop on what’s happening in the mortgage market will continue to be a valuable asset for buyers all over the GTA and beyond.
Easing the Burden for New Buyers
The numbers are in and trends point to a mild economic slow down ahead. To help the next generation of homeowners, Canada could offer increased incentives or loosen the requirements to qualify — especially in the Toronto area. If this happens, counties throughout the province will likely follow suit. This would give young professionals an in at the housing markets stretching from the Saugeen Shores all the way past Barrie and everything between.
If the government doesn’t ease up on incentive qualifications and stress testing for those looking to switch their mortgage provider, credit unions all over the province can expect more bodies coming through their doors. Add in the anticipated steady increase in real estate value and it will become even more important for those with unique lending needs to seek out institutions that aren’t required to follow federal mortgage regulations.
A Seller’s Market
What else do we see for the 2020s? More competition for home buyers, for starters. The demand will continue to rise as supply stays the same. That means if you’re thinking of selling real estate, chances are your listing won’t stay on the market long. A seller’s market makes purchase prices rise, so expect average mortgage amounts to go up once again. Property values are poised to surpass the highs we saw a few years ago but this time, the increase will stick.
A Mobile Generation
This is the decade that the Z Generation or I Generation (those born after 1995) become of age. Many in this age range were born to the X Generation or those who followed the Boomers. This generation, raised on the internet and social media, are making consumer decisions with the aid of their smartphone — if Siri doesn’t know, it is not worth knowing.
The newest adults in society are mobile — they are prepared to move to where they can raise their family as their work is becoming more mobile and transient with digital access and transit routes such as Subway and Go Trains. Cars are becoming a suspendable asset in favour of education for children and safe affordable housing options.
TAKE ON THE DECADE WITH CONFIDENCE
No matter what the next ten years bring, having knowledge on your side will serve you well. Looking for guidance through your next real estate purchase? Gerard Buckley brings an entire career of financial experience with him as well as an A+ rating from the Better Business Bureau. Most importantly, he bases all his business relationships on integrity and trust, leading buyers to smart mortgage solutions whether it’s your first home or your tenth investment property.
With offices located in Toronto, Collingwood, Owen Sound and the Saugeen Shores, Gerard Buckley can cater to clients all over the province of Ontario. He also gives you access to more than 80 reputable lenders, giving you options when you need them most. Don’t let changing regulations in a fast pace market leave you lost – get educated with Gerard today and make your financial dream a reality!
